Business Standard-
While Bajaj Auto wants to focus on just two brands, rival Hero Honda will add more to its already crowded product portfolio.
The more, the merrier’ has been the theme song of Bajaj Auto for many years. Not anymore.
India’s second largest two-wheeler company, which had bombarded the market with multiple brands (remember XCD, Kristal, Platina and a few others?) to break the near-monopoly of market leader Hero Honda in the economy segment, has withdrawn all but two of its brands.
The move is working. Last year, Bajaj Auto posted its best-ever annual sales, riding high on just two brands - Discover and Pulsar. The Discover is clearly positioned for the commuter segment and the Pulsar as the ‘sporty’ option. While the Pulsar has held its own over the years in the power and performance segment, the Discover is the pivot in the commuting category.
Bajaj Auto Managing Director Rajiv Bajaj says “brands can be created easily by the R&D people. We have to figure out if there is a third category of buyers out there. A Pulsar buyer is sporty, young, and wants to have some fun with the bike. The Discover buyer is more sober and an economy- conscious person who wants to take a safe decision and higher mileage,” he says.
“If we create a brand in the absence of a target category, it could be like putting up a restaurant which serves food nobody wants to eat. I could put up a Lebanese restaurant in Pune and go bankrupt”, adds Bajaj.
The MD says a manufacturer can merrily create a brand and forget about it, but he also needs to look out whether there is a category for it. “Creation of brands is in the hands of the manufacturer but the creation of a category is in the hands of the consumer. So unless we are sure that there is a third category there, we would be making a mistake by creating that third brand”, he says.
The company has changed its strategy from a product to a brand-led company as it believes that the product game will not go anywhere and it is only brands that will make all the difference.
Presently about 70 per cent of the company’s sales come from the Discover and Pulsar segment, both of which share seven models between them — up from just three about three years ago. The company reported its highest ever monthly sales in April (276,000 units) followed by a record number in May. It aims to sell one million Pulsar units every year starting this year.
The company, which had a 20.47 per cent market share in the two-wheeler category in May – up from 19.05 per cent in the previous month – is working on adding yet another model under the Pulsar category in the coming months. It also launched last month a new 150 cc bike under the Discover brand. The company intends to focus on just these two brands till the market is mature enough for more.
However, that’s something the market leader doesn’t believe in. Hero Honda, which had a 45.38 per cent market share in May (48 per cent in April), is planning a brand blitz by launching at least two more new brand launches this year to take its total tally to 10.
Anil Dua, vice president, sales and marketing, Hero Honda, says, "We had very successful brand launches in the past including ZMR, Hunk, Passion Pro and Pleasure and want that to continue.”
Asked whether launching of new brands and turning them into successful ones is easier for a market leader, Dua says the success came because Hero Honda positioned its brands sharply on a clearly differentiated platform. “It’s all a function of the homework and ground work. If the customer trusts the company, the resistance to new launches is less. It’s indeed tougher for a smaller company to promote a new brand,” he adds.
Splendour, which is in its 16th year, is the largest two-wheeler brand in the world followed by Passion.
Last year, five models under these two brands clocked sales of over two million units. The company says it is presently struggling to increase the capacity of the Hunk as demand is far outstripping supply.
A section of the market believes that the success of the Hero Honda models is more because of the company's brand recall rather than the products themselves (remember the caption 'Fill it, shut it, forget it’). But that still seems to be only a minority opinion.
Fiscal 2010 saw Hero Honda launching nine new models across segments, all of which are doing well. Sales of Pleasure, for example, have already crossed the 20,000 units per month threshold. Also, powered by its 4,200 touch points, the company has already crossed the landmark figure of four million cumulative sales in a single year and posted sales of more than a million units for every quarter in FY’10.
Suzuki brings to India two new sports bikes
NEW DELHI: Japanese two-wheeler major Suzuki on Monday launched its superbike GSX-R1000 at Rs 12.75 lakh (ex-showroom, Delhi) making it the costliest product from the company's stable in the country.
Suzuki Motorcycle India, the wholly-owned subsidiary of the Japanese giant, doled out another superbike Bandit1250S worth Rs 8.5 lakh. It currently sells two more premium bikes -- Hayabusa and Intruder -- costing Rs 12.5 lakh each.
"This launch is in line with our aim to deliver outstanding technology and performance to the Indian market. We are pleased to offer exciting riding experience to pro-bikers," Suzuki Motorcycle India Pvt Ltd (SMIPL) Chairman Katsumi Takata said in a statement.
The company, which is a marginal player in the commuter segment of the two-wheeler market, is targeting to sell at least 200 units of the two new bikes in the first year.
Suzuki Motorcycle India, the wholly-owned subsidiary of the Japanese giant, doled out another superbike Bandit1250S worth Rs 8.5 lakh. It currently sells two more premium bikes -- Hayabusa and Intruder -- costing Rs 12.5 lakh each.
"This launch is in line with our aim to deliver outstanding technology and performance to the Indian market. We are pleased to offer exciting riding experience to pro-bikers," Suzuki Motorcycle India Pvt Ltd (SMIPL) Chairman Katsumi Takata said in a statement.
The company, which is a marginal player in the commuter segment of the two-wheeler market, is targeting to sell at least 200 units of the two new bikes in the first year.
TVS Motor signs MOU with Thiagarajar College
Madurai, June 24
TVS Motor Company and the Thiagarajar College of Engineering (TCE) have signed a memorandum of understanding (MoU) for including industrial training in the B.E. Mechanical Engineering programme of the college.
The MoU was signed by Mr K.N. Radhakrishnan, President and CEO, TVS Motor Company, and Dr V. Abhai Kumar, Principal, TCE.
The collaborative undergraduate programme would include four to six weeks of internship during the semester vacations as well as a major project at the company or any of its associates during the last semester.
Students of the BE Mechanical Engineering programme would be eligible to pursue the course at the end of the first semester and initially 30 students would be selected with the benefit of financial assistance and the strength would be raised over a period.
Speaking on the occasion, Mr Radhakrishnan said the objective of the collaboration was to produce high-calibre mechanical engineers who would be industry-ready on completion of the course. “Currently, it takes one-and-a-half years to train people in the industry,” he said.
Managers from TVS Motor Company and Professors from TCE would co-create a contemporary curriculum, teaching methodology and the evaluation process to prepare the students as first-class corporate citizens in about two years, he said.
The programme is a win-win opportunity for the students of the college as well as TVS Motor Company as it seeks to enhance the competence of the students and act as a catalyst for placements on completion of the course.
As the specific skills of the students is showcased during the internship, the company also stands to gain, Dr Abhai Kumar added.
TVS Motor Company and the Thiagarajar College of Engineering (TCE) have signed a memorandum of understanding (MoU) for including industrial training in the B.E. Mechanical Engineering programme of the college.
The MoU was signed by Mr K.N. Radhakrishnan, President and CEO, TVS Motor Company, and Dr V. Abhai Kumar, Principal, TCE.
The collaborative undergraduate programme would include four to six weeks of internship during the semester vacations as well as a major project at the company or any of its associates during the last semester.
Students of the BE Mechanical Engineering programme would be eligible to pursue the course at the end of the first semester and initially 30 students would be selected with the benefit of financial assistance and the strength would be raised over a period.
Speaking on the occasion, Mr Radhakrishnan said the objective of the collaboration was to produce high-calibre mechanical engineers who would be industry-ready on completion of the course. “Currently, it takes one-and-a-half years to train people in the industry,” he said.
Managers from TVS Motor Company and Professors from TCE would co-create a contemporary curriculum, teaching methodology and the evaluation process to prepare the students as first-class corporate citizens in about two years, he said.
The programme is a win-win opportunity for the students of the college as well as TVS Motor Company as it seeks to enhance the competence of the students and act as a catalyst for placements on completion of the course.
As the specific skills of the students is showcased during the internship, the company also stands to gain, Dr Abhai Kumar added.
Low demand forces TVS to stop producing e-vehicles
Chennai-based TVS Motor Company says it has put its electric vehicles production plans on hold due to lukewarm response from the market.
The company has shelved plans to launch electric three-wheelers and stopped production of battery powered Scooty Teenz scooter.
“We have an electric three-wheeler, which we had planned to introduce but there is no market for such products. So we don’t have any plans to launch it now,” TVS Motor Company marketing president, Mr H.S. Goindi, said.
It has no immediate plans to resume the production of its electric scooterette, Scooty Teenz Electric, which it stopped manufacturing since May 2009. The electric model was launched in April 2008.
The company has shelved plans to launch electric three-wheelers and stopped production of battery powered Scooty Teenz scooter.
“We have an electric three-wheeler, which we had planned to introduce but there is no market for such products. So we don’t have any plans to launch it now,” TVS Motor Company marketing president, Mr H.S. Goindi, said.
It has no immediate plans to resume the production of its electric scooterette, Scooty Teenz Electric, which it stopped manufacturing since May 2009. The electric model was launched in April 2008.
Suman Kant Munjal to hold 26% stake in Hero Honda
Post-restructuring in the Hero Group, Suman Kant Munjal, the second son of Hero Honda Chairman Brij Mohan Lall Munjal, will own 26 per cent stake in Hero Honda Motors, the country’s largest two-wheeler company. The 26 per cent stake was earlier scattered among Munjal siblings, while the remaining 26 per cent continues to be with Honda Motor Company of Japan. While public holding as of March 31 is 45.06 per cent, promoters and promoters group hold the rest.
Under the family settlement that concluded recently, Brijmohan’s family will own Rockman Cycle, Hero Corporate Service, Hero ITES, Hero Mindmine, Hero Soft and Easybill. All these companies will be jointly owned by Brij Mohan Lall Munjal’s sons — Pawan Kant, Sunil Kant, Suman Kant — and the family of late Raman Kant.
Under the family settlement that concluded recently, Brijmohan’s family will own Rockman Cycle, Hero Corporate Service, Hero ITES, Hero Mindmine, Hero Soft and Easybill. All these companies will be jointly owned by Brij Mohan Lall Munjal’s sons — Pawan Kant, Sunil Kant, Suman Kant — and the family of late Raman Kant.
TVS plans to relaunch Max motorbike in July
The avatar of the two-stroke bike may be priced below Rs 40,000 The company aims to sell two million bikes and Bloomberg three-wheelers this financial year INDIA’S third largest two wheeler maker TVS Motor is looking to relaunch the Max motorcycle as a fourstroke 100 cc bike named Max 4R in July this year, a source with direct knowledge of the development said.
TVS had discontinued the Max 100 in 2005 as its two-stroke engine was not compliant with the then implemented Bharat Stage II emission norms. The Max range constituted about 90 per cent of the company’s sales in the earlier part of the decade.
“It could be launched.But I cannot give you further details,” company spokesman Adrian Dass said.
TVS is likely to see a big chunk of sales coming from its entry-level motorcycles.The company aims to sell two million twoand threewheelers this financial year.
The entry-level motorcycle segment currently dominated by the likes of Hero Honda's CD Dawn and Bajaj Auto's Platina. The segment forms 76 per cent of all motorcycle sales.
About 7.34 million motorcycles were sold in 2009-10, according to the Society of Indian Automobile Manufacturers. Hero Honda has a market share of close to 75 per cent of the entry-level motorcycle pie.
Honda Motorcycle & Scooter India at this year’s Auto Expo announced its foray into the entry-level bike segment with the 110 cc CB Twister that costs about Rs 42,000. India Yamaha Motor launched the 110 cc YBR bike last month priced at Rs 41,370.
The TVS Max 4R is expected to be priced below Rs 40,000. TVS already sells the Star, Sport and the recently introduced autoclutch Jive in the entrylevel motorcycles segment.
TVS had discontinued the Max 100 in 2005 as its two-stroke engine was not compliant with the then implemented Bharat Stage II emission norms. The Max range constituted about 90 per cent of the company’s sales in the earlier part of the decade.
“It could be launched.But I cannot give you further details,” company spokesman Adrian Dass said.
TVS is likely to see a big chunk of sales coming from its entry-level motorcycles.The company aims to sell two million twoand threewheelers this financial year.
The entry-level motorcycle segment currently dominated by the likes of Hero Honda's CD Dawn and Bajaj Auto's Platina. The segment forms 76 per cent of all motorcycle sales.
About 7.34 million motorcycles were sold in 2009-10, according to the Society of Indian Automobile Manufacturers. Hero Honda has a market share of close to 75 per cent of the entry-level motorcycle pie.
Honda Motorcycle & Scooter India at this year’s Auto Expo announced its foray into the entry-level bike segment with the 110 cc CB Twister that costs about Rs 42,000. India Yamaha Motor launched the 110 cc YBR bike last month priced at Rs 41,370.
The TVS Max 4R is expected to be priced below Rs 40,000. TVS already sells the Star, Sport and the recently introduced autoclutch Jive in the entrylevel motorcycles segment.
Rallyists thrill coffee country
Ooty: Coorg and rallying go hand in hand. It was back to thrilling 'coffee country' for some high speed action on the second day of the Maruti Suzuki Dakshin Dare.
The day began after the overnight halt in Mysore, as usual in the wee hours of the morning. It was a 100km drive. Thankfully, the highway allowed for a high speed run. Once in Polibetta, where the stages were run, the lush green coffee plantations were a welcoming sight. After some setting up work, it was back to the fast action. The local people proved to be a rather enthusiastic lot, shouting and cheering as the cars and bikes went past. One coffee plantation worker even asked, "Is Sebastien Loeb coming in his Citroen car?" Maybe the six-time world champion will turn up after a few more years when the World Rally Championship comes to India.
The day's schedule included three stages, which were to be run twice each. The stages were nine, 16 and 11 km long. Some of the stages were pretty smooth, while others were perfect for off-road vehicles. That must have been something drivers like overnight leader Niaz Ali (co-driver Kim Epton) in a Suzuki Grand Vitara, Suresh Rana (Ashwin Naik), Sachin Singh (Nikhil Pai), both in Maruti Suzuki Gypsy vehicles, would have enjoyed. But for rally driver Prithvi Dominic (Jeevaratinam), who was in a Mitsubishi Cedia, the bumpy roads proved to be a nightmare. To top it all, several competitors went off at a certain turn in the third stage.
Nine cars in the Ultimate category were running out of the 12 that started on the first day. Sachin Singh and Khushwant Randhawa went out but are likely to rejoin on Thursday. Shailendra Hegde (Shiraz Ahmed) went out on the first day itself.
Team TVS rider KP Arvind, the overnight leader, too had a bout of misfortune. The swing arm on his TVS motorbike broke in the morning and he could not continue on the day. However, he will continue the rally on Thursday under the super rally format.
After the stages in Polibetta till the afternoon, it was a treacherous but amazing drive from Coorg to Ooty, where the entourage is halting for the night. The 200km drive was no piece of cake either. Though it was only the transport stage and ample time was given to the competitors to report at the final time control checkpoint for the day, rain and fog did not make things easy. More than the car drivers, it was the bikers who had to face the elements. The added difficulty was the numerous hairpin bends that one had to negotiate on the way up.
On the third day of the event on Thursday, the stages will be run outside the town and on the way to Coimbatore. The stages will be much faster than on Wednesday and there should be some good action.
The day began after the overnight halt in Mysore, as usual in the wee hours of the morning. It was a 100km drive. Thankfully, the highway allowed for a high speed run. Once in Polibetta, where the stages were run, the lush green coffee plantations were a welcoming sight. After some setting up work, it was back to the fast action. The local people proved to be a rather enthusiastic lot, shouting and cheering as the cars and bikes went past. One coffee plantation worker even asked, "Is Sebastien Loeb coming in his Citroen car?" Maybe the six-time world champion will turn up after a few more years when the World Rally Championship comes to India.
The day's schedule included three stages, which were to be run twice each. The stages were nine, 16 and 11 km long. Some of the stages were pretty smooth, while others were perfect for off-road vehicles. That must have been something drivers like overnight leader Niaz Ali (co-driver Kim Epton) in a Suzuki Grand Vitara, Suresh Rana (Ashwin Naik), Sachin Singh (Nikhil Pai), both in Maruti Suzuki Gypsy vehicles, would have enjoyed. But for rally driver Prithvi Dominic (Jeevaratinam), who was in a Mitsubishi Cedia, the bumpy roads proved to be a nightmare. To top it all, several competitors went off at a certain turn in the third stage.
Nine cars in the Ultimate category were running out of the 12 that started on the first day. Sachin Singh and Khushwant Randhawa went out but are likely to rejoin on Thursday. Shailendra Hegde (Shiraz Ahmed) went out on the first day itself.
Team TVS rider KP Arvind, the overnight leader, too had a bout of misfortune. The swing arm on his TVS motorbike broke in the morning and he could not continue on the day. However, he will continue the rally on Thursday under the super rally format.
After the stages in Polibetta till the afternoon, it was a treacherous but amazing drive from Coorg to Ooty, where the entourage is halting for the night. The 200km drive was no piece of cake either. Though it was only the transport stage and ample time was given to the competitors to report at the final time control checkpoint for the day, rain and fog did not make things easy. More than the car drivers, it was the bikers who had to face the elements. The added difficulty was the numerous hairpin bends that one had to negotiate on the way up.
On the third day of the event on Thursday, the stages will be run outside the town and on the way to Coimbatore. The stages will be much faster than on Wednesday and there should be some good action.